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Thursday, March 21, 2013

On government health spending, I think the ADB, WHO, UN, etc.
data on PH public health spending is understated and wrong. They usually count
only DOH + PhilHealth spending. They do not include some or all of other govt
spending such as:

1. LGUs, with provincial and city health centers and
hospitals. Manila City alone has six city-owned hospitals.2. Philippine General Hospital (PGH), budget about P2 billion
a year, part of the UP annual budget; hence, it is not counted as health
spending but education spending….

This table is from the World Health Organization (WHO) which I copied today. It says that the Philippines’ health spending / GDP
ratio as of 2010 was only 3.6 percent.

I posted the above observation (in italics) in the email loop among members of
the Medicines Transparency Alliance (MeTA) Philippines, where an
official of the WHO West Pacific Regional Office (WHO-WPRO), Ms. Klara Tisocki,
is among the members.

Klara was kind enough to reply. She said,

Regarding your comments please
note that WHO collects health expenditure related data in countries via the
national health accounts (NHA). NHA constitute a systematic,
comprehensive and consistent monitoring of resource flows in a country’s health
system for a given period. NHAs use classification schemes, which are designed
to be compatible with those practiced internationally; most importantly, the
System of national accounts (SNA), to make cross-national comparisons possible.

The International Classification for
Health Accounts (ICHA) is a comprehensive system which classifies NHA into four
dimensions: Financing sources (FS)-contributions by different actors; Financing
agents (HF)-entities who manage health expenditures; Providers (HP)-entities
that provide health care services and goods; and Functions (HC)-types of health
care activities. You can read more about NHA at WHO webpage: http://www.who.int/nha/what/en/index.html

More specifically regarding
the Philippines health expenditures these are collected via the Philippines
National Health Account (PNHA) (which in turn reports to
WHO for inclusion of Philippines data in WHO databases).

I would also like to refer you to
the technical notes, http://www.nscb.gov.ph/stats/pnha/technotes.aspon
sources of data for the Philippines health financing, with regard to your
assumption that WHO, ADB, UN etc. count only DOH and Philhealth spending.
In these notes you will find the detailed description of Data Sources and
Estimation Procedures as approved by NSCB Resolution No. 8 Series of
2011, that shows what data from which sources are
included under the different sectors and you can see the wide range of data
sources considered.

I thanked Klara for
her reply as it provided useful links. From the NSCB link, here are the numbers:

I think the PGH
budget, AFPMC, Air Force hospital, Veterans Hospital, PNP Hospital, etc. were
indeed included in the national government spending for HC. DOH budget in 2010
was P24.65 billion but in the NSCB Health Expenditure data, total national government
spending was P42.40 billion. The P18 B extra should have been accounted for by
those non-DOH hospitals and other health spending by other national government
agencies. Thanks, I stand corrected in my earlier comments.

Meanwhile, let us now
compute the Health/GDP ratio for 2010:

Total health
expenditures, P379.32 billion.

GDP (nominal),
P9,003.48 billion

Health / GDP ratio =
4.2 percent.

The WHO data in Table 1 above is
wrong. It’s not 3.6 percent, or 0.6 percent of GDP lower than actual.

A 0.1 percent of GDP
difference is equivalent to P9.0 billion pesos. So, a 0.6 percent of GDP means
P54 billion difference, a substantial amount of money understated in the first
computation above.

On another note, I
think it's the data on private sector spending that is understated. In
particular, charity spending for healthcare is absent in the Table 1. Reiner Gloor
of PHAP once mentioned that PHAP Cares Foundation alone gives away about P100 million
a year in free medicines to various recipients, national-local governments,
communities in disaster areas, NGOs, etc. Then Unilab and other PCPI member
companies should also have several million pesos per year of free medicines
given to charity.

In many civic and
professional organizations like Rotary, healthcare is a big project for many
clubs. Last year I attended one rotary meeting of District 3830 on the Gift of
Life (GOL) program, donation for children with congenital diseases (CGD). In
just about 20 minutes of asking for donation, they were able to raise P1.2
million. And there were other late pledges. All the money was set aside for poor
patients of the Children's Hospital in QC.

There is also a new
initiative called I am PGH – a Person Giving Hope. A fund raising project for
poor patients at the Philippine General Hospital, initiated by a friend, JB
Baylon. From the photos and stories posted by JB, many people are giving to the
project. The facebook page is http://www.facebook.com/iampgh?fref=ts

Then many private
hospitals also have their own charities, giving healthcare for free to limited
patients who are really poor. This is in the form of non-revenues to the
hospital.

So I think the data on
Private Sources in Table 2 is understated as there is no mention and numbers
associated with “charity spending” and this can be a big amount.

Could it be that this
charity spending, when properly accounted, would raise the Philippines’ H/GDP
ratio close to 5.0 percent and not just 4.2 percent as recomputed above?

If so, there are
serious implications in public health policy. Among these:

1. The main issue is not “underspending in health” as the 5.0 percent of GDP as recommended by
the WHO seems to have been almost attained. The bigger issue is waste and
inefficiency in the use of those funds, especially tax money.

2. Thus, repeated
calls for “more tax money for healthcare” should be toned down if not halted.
Rather, the call should be “efficient use of tax money for healthcare”.

3. Certain government
personnel are over-protected in healthcare. Like those in the House of
Representatives, Senate, AFP, PNP, other big agencies. Here, they have three
levels of direct subsidized healthcare: PhilHealth + HMO + in-house medical and
dental clinic with free medicines, if not their own hospital.

4. Government itself then,
has become a big propagator of healthcare inequality. Many government personnel
have such three levels of HC while many ordinary people do not even have one.

Related to #2 above, a friend, Vanni
Villafuerte, commented,

Hi 'Noy, i just
remembered a procurement guy from WB reviewed the medicine warehouse of LGUs.
Only Marikina passed the test! CamSur practically wasted 100 million pesos
worth or meds. by not using it before the meds expired. multiply that by the
number of provinces that we have. that would be mind-boggling, how much meds is
wasted because of poor handling of medicines (temperature, etc.)

I remember that presentation by a WB consultant during the
MeTA National Forum in January 2009. I actually got angry listening to his
presentation. He showed photos of some LGUs’ medicine storage – where rats,
cockroaches, dirt, useful and expired medicines mixed up in one room. The
personnel in charge of such medicines storage could not tell which of those
medicines were already expired and which ones were still useful. The LGUs simply
gave away free medicines from time to time, mostly to their political
supporters. Or medicines were left to expire or deteriorate as the LGUs do not have temperature control for those medicines, not air-conditioned or at least kept from noontime temperature especially on weekends where electricity supply in many rooms are shut off.

Not “more taxes for healthcare” unless those wastes and
inefficiencies are addressed and corrected. Otherwise, we will only be throwing
more money to problems that create more new problems.